TSP Update for Month Ending February 2023 – after promising January, all TSP core funds except G saw small dips in value.
February brought a pullback from the significant January gains for most TSP participants. All the core funds, other than the G fund, notched a negative monthly return in February. However, all 5 core funds are holding onto gains year to date in 2023. A higher-than-expected inflation report in February caused concern that inflation could be around for longer than hoped. This would potentially lead to more interest rate increases in 2023 than investors were hoping for. There is wide dispersion among economists as to what 2023 will hold for both stocks and bonds. As usual, uncertainty leads to market volatility. TSP participants are wise to remain disciplined and stick to a good investment strategy despite the short-term gyrations of the market.
As noted in last month’s TSP article, I do not know if the next few months will be up or down for the market, but I do know that data shows it is more important to have “time IN the market” versus “TIMING the market.”
There are few administrative updates that TSP issued in February. Of note, many requests that previously were handled by paper forms have been moved completely online. For example, beneficiary updates will no longer be processed if submitted on the TSP-3 paper form. You must make any beneficiary updates via the online My Account website. To see the complete list of forms and their current status, refer to TSP Bulletin 23-2 which was published on February 2, 2023. Importantly, TSP will not notify you if you submit an obsolete form per the Bulletin. It is up to the participant to ensure their documentation is current and correct. TSP will not be responsible for obsolete forms that are submitted.
Finally, I am often asked how to build a good investment strategy for TSP. If you are unsure how to create an investment strategy that you can stick to, there are many resources available to you via Serving Those Who Serve. Start by registering for an upcoming TSP webinar on the Serving Those Who Serve website. I host these webinars with several teammates on a rotating schedule. I look forward to seeing you!
Monthly and year to date returns effective February 28, 2023 and longer-term averages are shown below. (source, TSP.gov)
| Year | G Fund | F Fund | C Fund | S Fund | I Fund |
| Last 12 months | 3.33% | -9.47% | -7.72% | -10.63% | -3.06% |
| 2023 YTD | 0.62% | 0.58% | 3.68% | 9.01% | 5.36% |
| 2023 Monthly | |||||
| February | 0.28% | -2.58% | -2.44% | -1.63% | -2.84% |
| January | 0.34% | 3.25% | 6.28% | 10.82% | 8.43% |
Month to month trends as shown above are interesting, but it is important to remember that short term market volatility is to be expected and employees should not be making investment decisions based on short term performance. Following are longer term rates of return for each fund, as of February 28, 2023. (source, TSP.gov).
| Year | G Fund | F Fund | C Fund | S Fund | I Fund |
| 1 year | 3.33% | -9.47% | -7.72% | -10.63% | -3.06% |
| 3 Year | 1.88% | -3.63% | 12.11% | 9.24% | 6.79% |
| 5 year | 2.13% | 0.64% | 9.79% | 6.84% | 3.06% |
| 10 year | 2.12% | 1.36% | 12.26% | 9.82% | 5.15% |
| Inception Date | 4/1/1987 | 1/29/1988 | 1/29/1988 | 5/1/2001 | 5/1/2001 |
Please reach out to us with questions and follow our website for the most recent updates. We are here to serve you! Thank you for your service to our government!
**Written by Jennifer Meyer, Financial Planner. The information has been obtained from sources considered reliable but we do not guarantee that the foregoing material is accurate or complete. Any opinions are those of Jennifer Meyer and not necessarily those of RJFS or Raymond James. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. Investing involves risk and you may incur a profit or loss regardless of strategy suggested. Every investor’s situation is unique and you should consider your investment goals, risk tolerance, and time horizon before making any investment or financial decision. Prior to making an investment decision, please consult with your financial advisor about your individual situation. While we are familiar with the tax provisions of the issues presented herein, as Financial Advisors of RJFS, we are not qualified to render advice on tax or legal matters. You should discuss tax or legal matters with the appropriate professional. **
***The Thrift Savings Plan (TSP) is a retirement savings and investment plan for Federal employees and members of the uniformed services, including the Ready Reserve. The TSP is a defined contribution plan, meaning that the retirement income you receive from your TSP account will depend on how much you (and your agency or service, if you’re eligible to receive agency or service contributions) put into your account during your working years and the earnings accumulated over that time. The Federal Retirement Thrift Investment Board (FRTIB) administers the TSP.***
